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Characteristics of an ‘Investable’ Startup

Thinking of starting a business? Thinking about investing in a startup? Both are increasingly popular activities these days. And lots of businesses can provide a good income for the founder. But what makes a business ‘investable’? That is, what are the characteristics of a startup business that a venture capital fund might invest in? Jonathan Friedman of LionBird, a digital health investor, recently wrote in VentureBeat about these six factors which, if present, dissuade him from making an investment:

  • Weak barriers to entry
  • Lack of meaningful differentiation
  • Unsustainable unit economics
  • Niche markets without explosive growth
  • Bad cap table
  • Founder bait and switch

Worth a read if you are considering getting in the game, regardless of the role you intend to play.

About Stephanie Strait

Stephanie Strait is Chief Operating Officer for Financial Poise and DailyDAC, LLC. She is responsible for managing initiatives and general internal-facing functions across divisions. She also produces the Company’s podcast, Financial Poise Radio™.

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